Buy A Home
Buying a home is a big decision – perhaps one of the biggest in your life. Your first house can be a place you call home for years to come, and it’s a long-term investment of your time and finances. That’s why it’s important to weigh all of the aspects of homeowning in advance.
Here are some factors to consider before beginning your homebuying process.
Your first home is a place you’ll return to after work, where you’ll make meals, maybe raise children – and location affects your quality of life.
Consider these steps when you’re thinking about the homebuying process as a first-time owner:
- Take a visit – or three: Will you want the same scenery in six months or six years? Will the property match your family’s evolving interests and needs? Before you buy, walk around and spend some quality time in the location you’re considering to be sure it feels right.
- Examine the surroundings: How walkable is the neighborhood? What are the demographics? Do you feel safe there? Is the area booming or in decline?
- Evaluate access: Don’t forget that you’ll have to get in and out of your home easily and conveniently. Is there a subway, bus or other public transit system nearby? How far is the property from the nearest airport or major city? How accessible are the roads leading to it? Will traffic complicate commuting or running errands?
After you have selected a location – or a few top contenders – for your first home, start examining the financial aspect of owning a home:
- Compare owning to renting: As a homeowner, you will be responsible for all repairs, replacements, etc., on top of utilities and other expenses. Calculate all of your existing expenses and then add on taxes, association fees (if you're looking to buy in a planned community, etc.) and other financial considerations associated with owning a home. Compare these estimates with your existing financial picture and where you think you'll be in the future and ask yourself if owning makes more sense than renting.
- Check your budget: Those "other financial considerations" mentioned above can add up: maintenance, repairs, replacements, equipment (i.e., do you own a lawn mower?). Does your income allow you to afford owning a home today - and tomorrow - without tapping into (or out) your savings?
- Calculate the complications: Buying a home can alter your financial situation, from tax reporting to credit and beyond. If you had a major life event that impacted your finances, could you still afford the house? Try to get a complete picture of the financial impact of homeowning, and make sure you're comfortable with the changes before signing on the dotted line.